There are over 200 slides in total that we go through on the course. Less than 10 of them are UK only – the rest are global principles.
In about 50% of scenarios the original owner does stay with a business we buy, however we tend to find that by targeting businesses with revenues larger than 500k per annum that they have outgrown owner centric customers. This tends to be a common problem in say 200k turnover businesses where the owner does almost all the functions of the business themselves. So while some handover of relationships maybe required, often customers want convenience and maintenance of the status quo over any kind of disruption.
I have done well over 100 deals and have advised on over 200 more by now and there is no such thing as typical. There are some structures that repeat, but nothing like a median deal structure. However, at our events we talk about the criteria that makes a deal good, so this gives us a number of criteria we can cross reference to see if we have a ‘goer’, for example, if we target a business between $500k and $5m in revenue, with zero entry cost (or $1 for all the shares to be more accurate), where we can remove something to make it profitable (ie debt, building, product line, person/people etc) or where one of our financial engineering techniques will pop it into profit and resell for 6 figures or more in a very short window of time then we tend to proceed. I hope that helps.
Technically, a phoenix is when you have a new legal entity/company, but the same name, directors, shareholders etc. Where as a prepack is a type of sale through administration, the buyer could be anyone, and the proceeds from the sale go to the creditors of the company. A phoenix can be done through a prepack, but not always. – Jeremy
This is impossible to say as people do the course for lots of different reasons, some to work on their own business, some to just buy a job, some to help sell their company and a range of things in between. Nearly everyone does something with what they have learned, but what that is varies widely. We have one guy who set up a consulting business, just selling one of the strategies that we teach, saying after 20 years in business and with a big black book of contacts, he can fix a companies cash flow. He now delivers our cash flow section of the course and charges a fee, which is very different from the structure we teach.
People do the course for such a wide selection of reasons it could not be measured. Also, many people go and use the strategies, keeping themselves to themselves, so we only know of the people who we work with. However, you will quickly realize that the course is great value when you see what you can do with this information. We will be releasing a “Hall of Fame” for the quickest deals done, from people that don’t mind that information being public – so we will update this page with that information once it is ready.
Is it a help or a hindrance to buy businesses engaged in things you love to do or are interested in?
It depends a lot on what your interested in, but in general yes, it is much better to be involved in a business that you are passionate about.
Hi, thanks for your questions. Firstly, the strategy does involve a degree of persuasion, which naturally comes from rapport, and rapport is not necessarily about being a people person, but more about coming across as someone who they want to spend time with and do business with. Secondly, age is not such a barrier, being plausible at your age is important and I think people recognize nowadays that there are ‘wizz kids’, the internet age has demonstrated that. But, the key is for you to position yourself in this way. There is a great book by Daniel Priestley called ‘Become a Key Person of Influence’, it is a quick and easy read but he breaks down in a nutshell, how to position yourself as a personal brand. With regards to both of these points, one of the things that we actively encouraged in The Harbour Club is to partner up where you lack skills, so work with someone who compliments your skills and split the job up. I am a great example of this, I am very good at getting the deals done on the way in and way out, but I am not very good at turning up as I do not live in the UK, so I partner with people who want to do the face to face aspects, and work with them. The Harbour club is how I find all of these partners, and I would always be happy to get involved with more deals.
I describe myself as sector agnostic, so anything really, in fact the diversity is quite dramatic – business services tend to work best, but this year so far I have bought a manufacturer and a wholesale distribution business. So, really can be anything. To give a taster, I bought a 15,000 square foot health club and spa, which was built and fitted out 5 years previously for over £3m, with about 1000 members paying £40 a month. I bought this for £15,000, but collected the membership of £40,000 the next day, so I was almost instantly £25,000 in front. I also bought a 33 year old air conditioning company with local government contracts for £1, a software developer with customers like GM and Philip Morris for £1, a 20 year old PR company with £1m of revenue for £1… the list goes on. I have done over 50 deals now and we go into detailed case studies on around 12 of these deals during my course.
Like anything, the more you put in the more you get out, so if you are looking to buy and sell companies, I would say you won’t do much else. This is not because it is time consuming, but because it is very rewarding and you find much more interesting things to do with your life other than working! If you want to use it as a strategy to grow your existing business – so buying up companies to bolt on to yours – you need to put in just a few hours a week in sourcing, phone calls and the odd meeting. This very easily fits around other things and this is how I operated when I started up, it was something I did as part of my week’s work.
You get a system to follow to help you source, acquire, fix and sell companies. It is very tactical, rather than theoretical, and is all backed up with real examples. You also get all of the legal documents, spreadsheets and other things that I use when doing deals, as well as my Skype details, so you are able to contact me after the course with questions or joint venture opportunities. So, if you find a deal and you feel you are not ready for whatever reason, I can assist you with advice. However, the course gives you all you need in order to do deals yourself. The unspoken benefit is the network you gain, not only myself on the end of Skype but also the other delegates. There is a certain caliber of person who does this course and often other deals and ventures develop within the group throughout the course.
Exactly the Opposite, the trick is to find them before they appoint any insolvency practitioner. In fact, just today I found a 30 year old printing company with a £1.1m turnover, but they appointed an administrator one week ago and now it is doomed to close down, losing all of their long standing employees. It’s really sad as if we had gotten there a week earlier, we could have saved everything and given the previous owner some upside. Using our financial engineering, the fix would have taken less than 4 weeks to add back over £100k of cash to the business.
Generally there are a couple of options, either use the acquired company as a sort of currency to buy equity in a much larger more profitable company. You can do this by offering to merge it with the other company in exchange for a percentage of the the equity, or make it a hub company for more acquisitions (this is called a roll up). The other option is you sell the company to generate cash to use for other deals. However once you have done the Harbour Club you will realise you do not need cash, you can invest your cash in other things and buy and sell businesses cash free. When you talk about bigger deals, the largest I have looked at with zero cash upfront is 19m euros, if your ambitions are bigger than this per deal then you do need to have access to some cash, whether yours or backers funds. However managing businesses for cash generation risks time and value, so I don’t recommend. However you can use the tactics I teach to do this for sure.
Under no circumstances would we take over personal guarantees. In fact Banks won’t let you transfer a guarantee, they only allow for additional guarantors, so the vendor can still be called upon. Our goal is to remove the guarantee or remove the debt, or both, through a series of tactics I call financial engineering. This means we can buy a company that has debt and guarantees today, but not tomorrow.
